Make No Mistake: Trying Something New in MRO is Worth the Risk

By George E. Krauter

March 01, 2017 at 7:08 AM

“A Person Who Never Makes a Mistake, Never Tried Anything New”– Albert Einstein 

At a procurement expo and conference, 58 people visited our MRO presentation on the benefits of outsourcing management of the MRO supply chain. Of those 58, 27 expressed significant interest in outsourcing MRO inventory management to reduce operational costs and increase plant reliability—and save their company money. Subsequently, of the 27 who were interested, just four continued into programs which resulted in an average 25% reduction in total cost of MRO ownership, inventory recovery via Master Data Leadership™ and Mean Time To Repair (MTTR) reductions that increased asset reliability.

Okay, what happened to the other 23 expo visitors who were positive about MRO cost recovery but did not take action to consider any next steps when they returned to the plant? Here are the results of an investigation into why the recognition of the potential benefits of MRO changed (did not resonate) from the positive interest at the expo to the real world in their work space.

  • Management said, “You want to do what? Are you crazy?”
  • “Everyone” complains about MRO; “Everyone” has an opinion about what to do, but there is no consensus as to what to change and/or how to change it. Since “no one” will agree, nothing changes.
  • I have too many emergencies to handle to find time to change (caused by MRO—the vicious circle).
  • What if it does not work, or what if some will not let it work? I will be blamed.
  • What if I stick my neck out? I could get fired.
  • We have many entrenched MRO suppliers that are protected. I would step on too many toes if I tried a single outsource solution to our MRO problem.
  • The company just had a layoff of 150 people; I want to lay low and not stand out so I will survive. (Wouldn’t this be the time to come forward with an idea that would save the company money?)
  • I passed it off to an associate. Which means I won’t be blamed if it does not work.
  • My director just signed a price agreement with traditional suppliers. Capturing all the other MRO costs we incur is not in my pay grade. 
  • The director of procurement views outsourcing as competition to procurement’s programs. They would not “buy in.”

So, keeping the status quo is safe, especially when change is considered radical, aka MRO outsourcing. Are the benefits of change worth the risk? How would you know if you do not investigate the potentials? As Albert Einstein said, You can’t make a mistake if you do not try anything new. What if he had not tried anything new? What if he had not taken the risk?

These 23 people are “MRO safe,” while their company continues to assume cost burdens that can be recovered.

Listen to a series of My Purchasing Center podcast interviews with George Krauter based on ideas in his new book, Outsourcing MRO: Finding a Better Way:

The Market Basket to Select an MRO Supplier: A Flawed Process?

How to Calculate the Cost of a Purchase Order 

Banging Head Against Wall: Overcoming Resistance to Change

Tags: purchasing MRO indirect Supply chain management Procurement sourcing
Category: Blog Post

George E. Krauter


George Krauter currently serves as Vice President for Synovos in Radnor, Pa. He is recognized as the originator of the concept that became known as “integrated supply.” He has participated as a guest speaker at Reliability 2.0, ISM Indirect Conference, International Maintenance Conference (IMC), The Conference Board, and events for APICS, SMRP, and ISM professional chapters. 

George is recognized as an authority on methods to achieve reliable, maintenance-connected MRO storerooms; he has published his experiences in Uptime Magazine, Food Manufacturing, My Purchasing Center, and Supply & Demand Chain Executive. He holds a B.A. and M.B.A.A. from Temple University (Philadelphia) and has conducted seminars internationally (Oslo, Abu Dhabi) as well as sessions at Duke University, MIT, Howard University, and Temple. He lives in Bucks County, Pa., with his wife Joyce; all grandkids live within eating distance. You may reach George by phone at 610-246-6492.

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